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O'Shield v. Lakeside Bank

November 27, 2002

LEROY O'SHIELD AND BEVERLY O'SHIELD, PLAINTIFFS-APPELLANTS,
v.
LAKESIDE BANK, A CORPORATION, AS TRUSTEE UNDER TRUST AGREEMENT DATED SEPTEMBER 5, 1996, AND KNOWN AS TRUST NO. 10-1789; 5350 SOUTH SHORE, L.L.C., A LIMITED LIABILITY CORPORATION; HORWITZ AND COMPANY, INC., AN ILLINOIS CORPORATION; AND TEM HORWITZ, DEFENDANTS-APPELLEES.



Appeal from the Circuit Court of Cook County, Chancery Division. No. 98 CH 11822 The Honorable Aaron Jaffe, Judge Presiding.

The opinion of the court was delivered by: Justice Gordon

Unpublished

Plaintiffs LeRoy O'Shield and Beverly O'Shield (plaintiffs) appeal from the trial court's order denying their motion for reconsideration of a prior order granting summary judgment to defendants Lakeside Bank, 5350 South Shore, L.L.C., Horwitz & Co., and Tem Horwitz (defendants) in relation to a real estate purchase contract. Plaintiffs ask that we order specific performance of the contract or, alternatively, that we reverse the trial court's grant of summary judgment and remand this cause. Because we find that plaintiffs' exclusive remedy was return of their earnest money, we affirm.

BACKGROUND

In November 1996, plaintiffs entered into a contract for the purchase a townhouse being built by defendants *fn1 in the development known as 5350 South Shore Drive Townhomes. The contract signed by plaintiffs and defendants contained the following provisions:

"3. Date of Completion. *** If the Townhouse has not been substantially completed within one hundred eighty (180) days after the Estimated Completion Date ***, then Purchaser may, as its sole remedy, terminate this Agreement upon five (5) days prior written notice to Seller and the Earnest Money, and all interest which may have been earned thereon, and all other sums paid by Purchaser to Seller shall be refunded to Purchaser, whereupon this Agreement shall be null and void without further liability to Seller.

***

14. Defaults and Termination. ***

If Seller fails to perform any of Seller's obligations under this Agreement and such failure continues for ten (10) days after Purchaser delivers to Seller written notice of such failure, Purchaser's only remedy shall be to terminate this Agreement by written notice delivered to Seller. Upon such termination resulting from Seller's failure to perform any of its obligations under this Agreement, all payments made by Purchaser to Seller under this Agreement shall be returned to Purchaser and thereupon this Agreement shall be null and void, and of no further force and effect, and neither party shall have any further rights or obligations thereunder."

During construction of the townhouse, plaintiffs made two earnest money payments to defendants, for a total of $48,050. However, once it was built, defendants, in breach of contract, refused to complete the sale of the townhouse to plaintiffs.

Plaintiffs thereupon filed a one-count complaint against defendants for specific performance of the sales contract. Defendants moved to dismiss. Before any determination was made on this motion, plaintiffs were granted leave to file an amended complaint, adding a second count for money damages for interest on the earnest money and a third count for intentional infliction of emotional distress. Defendants again moved to dismiss, stating that the exclusive remedies provisions found in paragraphs 3 and 14 of the contract barred specific performance. Plaintiffs obtained leave to further amend their amended complaint, whereupon they included, among other contentions, allegations of racial bias and specific allegations of individual liability with respect to Tem Horwitz as president of Horwitz & Co. in a separate count. Defendants' motion to dismiss was denied.

After discovery was conducted, defendants moved for partial summary judgment, asserting that the contract's provisions mandated summary judgment with respect to plaintiffs' claim for specific performance, that the count for individual liability against Tem Horwitz should be dismissed with prejudice, and that summary judgment should be granted on the issue of racial bias. The trial court granted defendants' motion in part and denied it in part. First, the court granted summary judgment to defendants on the question of racial bias, finding that plaintiffs failed to adequately demonstrate their claim. Second, the court denied summary judgment in relation to Tem Horwitz's individual liability, finding that plaintiffs had alleged sufficient facts in this regard. Finally, as to specific performance, the court granted defendants' motion for summary judgment, finding that there were no genuine issues of material fact. The court held that the contract's terms, as exemplified in paragraphs 3 and 14, were clear and unambiguous that plaintiffs' "only remedy in case of nonperformance by the [d]efendants is to void the contract and have all payments returned." (Emphasis in original.) Therefore, concluded the court, because plaintiffs "failed to show that there are genuine issues of material fact in dispute as to whether the [contract] bars specific performance from being sought as a remedy," summary judgment for defendants on this count was proper.

Plaintiffs then filed an emergency motion to vacate the trial court's order as to its findings regarding specific performance only. Alternatively, plaintiffs asked the court to enter Supreme Court Rule 304(a) (155 Ill. 2d R. 304(a)) language allowing for appeal. This motion was adopted by the court, with the parties' agreement, as a motion for reconsideration. The court ...


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